Health-care audits, transparency grow in popularity

Updated 11:02 am, Wednesday, June 25, 2014

Companies are doing what they can to cut their share of employee health-care costs. They've raised deductibles, boosted co-payments and increased the out-of-pocket maximum that employees must pay before the health plan steps in to cover the remainder of individual expenses.

What's next? Cutting out spousal coverage is starting to catch on, according to a local survey of human resource managers. So is charging more for a spouse's health care coverage.

But the most popular money-saving option is for companies to conduct audits to make sure that every dependent listed on an employee's health plan is eligible for coverage, according to the survey conducted by the employee benefits firm Arthur J. Gallagher & Co. and sponsored by HR Houston.

More than 150 companies participated in the survey about compensation and benefit programs in a variety of industries, including energy, manufacturing and professional services.

Currently, 22 percent of companies in the Houston area reported they're already conducting dependent eligibility audits and another 14 percent plan to later this year, according to the survey.

It's a huge spike, said Jeff French, area senior vice president for Arthur J. Gallagher & Co. in Houston. Just last year, only 5.6 percent of companies said that they were monitoring who was on their health insurance plans.

"They're getting people off the plans who shouldn't be on them," he said. That can include adult children who reach the age of 26 and are no longer eligible for coverage. Or it can include minors who aren't, in fact, related to the employee.

While most of the audits don't uncover many ineligible dependents - many employers reported the rate was less than 1 percent - 80 percent of them said it was worth the investment in time and money, the survey said.

Another way that companies are saving money is to steer more employees to what's known as consumer-driven health plans such as health savings accounts. The plans, which must be coupled with high-deductible health insurance policies, provide a way to put money aside, tax free, for out-of-pocket medical expenses.

According to the survey, 23 percent of employers have adopted those type of plans while another 10 percent plan to do so this year.